How Sound Are Current Policy and Functional Arrangements?
88. Officials have undertaken a preliminary comparison of functional arrangements and policy settings in the four sectors, against the policy functions and the "best practice" policy framework. The intent was to enable tentative conclusions to be drawn on whether policy settings in the four infrastructure sectors are well aligned with sustainable development, and whether any improvements to functional arrangements might be suggested. The results of this assessment are discussed below.
Promoting Government Outcomes
89. Are policy settings and functional arrangements likely to deliver the key (central and local) government objectives within the GIF and the SDPoA?
90. Infrastructure considerations are explicit features of three of the SDPoA work programmes: sustainable cities (seeking "improved provision of infrastructure and services"), energy, and water allocation use and quality. Infrastructure is also one of the "themes" under GIF.
91. Officials considered how well the policy settings of each of the infrastructure sectors are aligned with the Government's sustainable development objectives. Officials concluded that, while there are a variety of institutional arrangements, sustainable development objectives are generally a common theme in the policy settings of the four infrastructure sectors. Sustainable development principles are comprehensively included in transport policy and improvements in incorporation of sustainable development within energy and water are underway as a result of initiatives in the SDPoA. Some sustainable development objectives also feature in telecommunications policy (e.g. the telecommunications service obligation) and further improvements will be included in the proposed Digital Strategy. Attachment 5 sets out details.
Establishing Policy Settings
92. The assessment of policy settings and functional arrangements suggests that there are some weaknesses in present policy settings, but has not uncovered significant, previously unrecognised gaps.
Information and Monitoring
93. To "use the best information available to support decision making" is one of the ten principles of the SDPoA. This implies that decision-makers should have access to high quality information that allows them to monitor existing and future conditions or issues and to make informed decisions.
94. Hence, it may be necessary to provide sufficient information for government monitoring to:
- Establish drivers of demand for infrastructure services, monitor trends in these drivers and form expectations about future movements ("futures analysis");
- Identify possible "bottlenecks" or pressure points;
- "Benchmark" New Zealand's infrastructure performance against international practices;
- Ensure the security and reliability of infrastructure capital stock to meet current and anticipated demand - including resource supply, capacity, condition, uptake of infrastructure alternatives and efficiency;
- Monitor the appropriateness of provision of goods currently deemed as "public" in the face of changing conditions, especially technological change;
- Ascertain that infrastructure is making a positive contribution to (and minimising adverse impacts on) sustainable development;
- Monitor the performance of Government policy and public agencies, e.g. to assess whether policy intervention might achieve improvement;
- Establish the community's redundancy requirements (e.g. dry-period security of supply).
95. Clearly, a wide range of quantitative and qualitative information is required to assist in making informed decisions.
96. The policy and functional assessment has drawn attention to some weaknesses in infrastructure monitoring arrangements. Significant infrastructure information gaps have been identified:
- Insufficient information collected or, in some sectors inadequate information disclosure requirements, has impacted on monitoring to identify possible pressure points or bottlenecks;
- Little or no benchmarking against best practice or international standards is undertaken. Benchmarking does not focus on the absolute level of performance, but is rather a measure of how New Zealand's relative performance affects our competitiveness and growth prospects internationally;
- With respect to sustainable development, there is no systematic monitoring of the progress towards decoupling of economic growth from pressures on the social, cultural or physical environment.
97. Monitoring and analysis (as opposed to statistical design and data collection) are considered a core responsibility of the relevant policy agencies. The next section contains a number of recommendations to improve infrastructure data collection and monitoring.
Futures Analysis
98. The policy and functional assessment has also drawn attention to weaknesses in futures analysis relating to infrastructure provision. Robust futures analysis would encompass:
- assessing the significance of alternative "mega-trends" (e.g. relating to possible geo-political events and the like) and the impact of new technology;
- taking account of forecasts of relevant variables which are amenable to analysis (e.g. GDP, population cohorts);
- ensuring a preparedness for dealing with shocks (e.g. SARS).
99. Public and private sector participants undertake considerable work in energy (e.g. MED's Energy Outlook), and futures work is included in the SDPoA programme on energy. Transit New Zealand has prepared 10 year plans for state highways and the Local Government Act 2002 requires local authorities to take at least a 10-year outlook in developing their Long Term Council Community Plans (LTCCPs), which will include, among other things, water and wastewater services and local roading.
100. However, there may be advantage in extending the present work so that it deals more comprehensively with these elements.14 There may also be a need for further work to assess the size of gaps between performance and expectations (this might help draw attention to a need for improved demand management and more innovative supply-side options such as small-scale renewable energy), and perhaps for exploring the linkages between scenarios across the different sectors.
101. Like monitoring, futures analysis is a core responsibility of the relevant policy agencies. Recommendations below are (inter alia) intended to facilitate better futures analysis by these agencies.
Emergency Management
102. Government also plays a major role in preparing for and co-ordinating responses to disasters (including acts of terrorism). Working with officials from other government departments, the Department of the Prime Minister and Cabinet (DPMC) has undertaken a preliminary investigation of critical infrastructure security. Details are set out in Attachment 6. DPMC will take account of the results of the Infrastructure Stocktake in its future work.
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